So Much For An Energy Policy This Year?

September 22, 2008

So it looks like that fabled "Gang of 20" in the Senate isn't going to introduce a bipartisan compromise on drilling, after all. Joe Romm argues that, after House Democrats went even further last week in allowing offshore drilling—in exchange for clean-energy incentives—than the Gang of 20 had originally proposed, the bipartisan compromise fell apart, and now Senate Republicans are just going to push to open up even more coastal areas for drilling. They didn't want to be, John Thune noted, "on the left of Nancy Pelosi."

Now, Romm thinks this was a horrific blunder on Pelosi's part: If Dems had just glommed on to whatever the Gang of 20 wanted, then conservative Republicans—and John McCain, especially—would be in a wretched bind, since they couldn't well criticize an "all-of-the-above" energy policy supported by both parties. Now, however, the GOP can just band together and oppose whatever energy policy Senate Democrats come up with as a "partisan" bill. (And, with the offshore-drilling moratorium expiring on October 1 anyway, why should they play nice?) Maybe Romm's right. But I tend to think Pelosi put together the best compromise measure she could, given some of the hideous alternatives being floated (even by members of her own party, the Blue Dogs especially). More likely, Gang of 20 Republicans like John Thune and Lindsey Graham were looking for an excuse to squirm out anyway, so as to avoid tossing McCain in a precarious position.

In the meantime, Max Baucus and Chuck Grassley have cranked out an energy-tax measure in the Senate that gives handouts to, well, to pretty much anyone who asked nicely enough—solar, wind, plug-in hybrids, sure, but also enhanced oil recovery, tar sands, oil shale, coal-to-liquid fuel… I'm still trying to make sense of this beast, but, as Dave Roberts points out, the big environmental groups are already lining up against it, arguing that the destruction wrought from the oil-shale drilling, tar sands, and coal-to-liquid fuel would vastly outweigh the good that would come from the credits for renewables, efficiency, and so forth. (Any bill that supports liquefied coal as a transportation fuel is especially problematic, for all the reasons outlined in this old TNR piece.)

Bottom line: It's anyone's guess as to whether we'll get any major energy measures this year. There's only a week left before Congress adjourns, and right now the financial crisis is—understandably—at the very top of the agenda. Gas prices are still packing a wallop, but the price of oil is tumbling in the face of a global slowdown, and lawmakers may feel less pressure on the energy front than they did during the summer.